Bloomberg Businessweek USA 09.30.2019

68

ILLUSTRATION

BY

GEORGE

WYLESOL.

DATA:

BUREAU

OF

ECONOMIC

ANALYSIS

Bloomberg

Businessweek

(USPS

080

900)

September

30,

2019

(ISSN

0007-7135)

H

Issue

no.

4631

Published

weekly,

except

one

week

in

February,

April,

June,

July,

September,

and

two

weeks

in

December

by

Bloomberg

L.P.

Periodicals

postage

paid

at

New

York,

N.Y.,

and

at

additional

mailing

offices.

Executive,

Editorial,

Circulation,

and

Advertising

Offices:

Bloomberg

Businessweek,

731

Lexington

Avenue,

New

York,

NY

10022.

POSTMASTER:

Send

address

changes

to

Bloomberg

Businessweek,

P.O.

Box

37528,

Boone,

IA

50037-0528.

Canada

Post

Publication

Mail

Agreement

Number

41989020.

Return

undeliverable

Canadian

addresses

to

DHL

Global

Mail,

355

Admiral

Blvd.,

Unit

4,

Mississauga, ON L5T 2N1. Email: [email protected]. QST#1008327064. Registered for GST as Bloomberg L.P. GST #12829 9898 RT0001. Copyright 2019 Bloomberg L.P. All rights reserved. Title registered in the U.S. Patent Office. Single Copy Sales: Call 800 298-9867 or email: [email protected]. Educational Permissions: Copyright Clearance Center at [email protected]. Printed in the U.S.A. CPPAP NUMBER 0414N68830

Theeconomyhasbeenperhapsthebrightestspotof

DonaldTrump’sunconventionalpresidency.Areces-

sionwouldtarnishthis,whichis presumablywhyhegets

soworkedupaboutperceivedmisstepsbytheFederal

Reserve.Butbyonemeasure,economicgrowthis already

slowerduringtheTrumperathanduringBarackObama’s

eightyearsaspresident.

Thatmeasureisgrossdomesticincome.GDIispart

ofthesamequarterlynationaleconomicaccountingby

theU.S.DepartmentofCommerce’sBureauofEconomic

Analysisthatgivesusgrossdomesticproductbutis

releaseda monthlater.Thetwonumbersshould,inthe-

ory, beidentical,buttheyneverquitearebecauseofthe

vagariesofreal-worlddata.Ina 2010paper,economist

JeremyNalewaik—thenattheFed,nowatMorganStanley—

madethecasethat“GDIbetterreflectsthebusinesscycle

fluctuationsintrueoutputgrowth.”

Thepaperhadsomeconsequences.TheBEAstarted

givingGDIsomeattentioninitsGDPnewsreleasesand

publishingtheaverageofGDPandGDI.Also,theFederal

ReserveBankofPhiladelphianowcalculatesa statis-

ticallysmoothedmeldingofGDPandGDI,devisedin

part byNalewaik,thatit callsGDPplus.Thepresidential

growthratesadmittedlydependa lotonthestartingquar-

teronechooses,especiallyforObama,whotookoffice

amidtheworstrecessionin 75 years.Also,whilegrowth

rates havebeenaboutthesameoronlymoderatelyhigher

underTrump,peoplearen’twrongtothinktheeconomy

is better.Morearesharingingrowthnowbecausethe

long expansionhasbroughtworkersoffthesidelines.<BW>

�Foxis a businesscolumnistforBloombergOpinion

◼ LAST THING

●BUTWAIT,IT

GETSBETTER

OfAmericansage

25-54,80%hadjobs

in August,according

totheBureauof

LaborStatistics,the

highestprime-age

employmentrate in

morethana decade

andperhapsa

bettermeasureof

economichealth

thaneitherGDPor

GDIgrowth.

With Bloomberg Opinion

● SMOOTH

CALCULATOR

Accordingto

BEAdata,GDIhas

grownata

2.3%

annualizedpace

sinceTrumptook

office,vs.2.4%during

Obama’stwoterms.

●TIMINGISEVERYTHING

If youmeasurefromthequarterbeforetheytook

office,Trumpleadsin GDIgrowth,2.5%to2.1%.

Measurefromthelastquarterofthefirstyear in

office(becauseit takestimeforpoliciestohave

aneffect),andit’sTrump2.5%toObama2.4%.

●ONTHEJOB

Payrollemployment

hasgrownata 1.5%

annualpaceduring

Trump’stimein

office,fasterthanthe

1%duringObama’s

entirepresidency

butslowerthanthe

1.9%ofObama’s

secondterm.

By Justin Fox

GDI and GDP Paint Different

Pictures of Growth

Realannualizedgrowthratesince

firstquarterofadministration

Obama Trump

Gross domestic product

Gross domestic income

Average

2.1%

2.4

2.3

2.3

2.5

2.7